How to Set Prices

Owing to the poor performance of traditional methods, more and more companies are discovering the importance of having a professional approach to pricing strategies.

Monday, September 26, 2011

Ariel Baños, economist and author of " Los secretos de los precios” (The Secrets of prices), writes in

"’Why worry about prices, if ultimately everything depends on the market? It is better to allocate resources towards reducing costs and increasing sales, which are actions within our grasp and have a direct impact on the outcome.’ This is how a CEO of a major company justifies the neglected place that pricing strategies hold within their organization.

This argument is representative of the views of many companies. There is widespread ignorance about the benefits and tools available to strategically manage prices.”
Baños cites the following 5 reasons why companies should not ignore this issue:
1 - Price is the variable which has the greatest impact on results
2 – It is possible to actively manage prices
3 - Price wars do not end in winners and losers
4 - More sales do not always mean higher profits
5 - Organization and processes are key to managing prices

Read the full article, in Spanish, in

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